October 30, 2007

Obama And Entitlements

Barack Obama hasn't been getting much love from the liberal blogosphere
for suggesting that Social Security poses a long-term fiscal problem for the federal
government (see Paul
Krugman, Ezra
Klein, and Matt
Stoller, among others). Obama's critics note, correctly, that it's
Medicare, not Social Security, that's responsible for the bulk of the
entitlement crunch we face (Jon
Chait also made this point recently), and that the bulk of that problem is that health-care costs
are rising rapidly. Insofar as Obama is concerned about entitlement spending,
they argue, he should be talking about ways to lower health-care costs, rather
than discussing possible reforms to Social Security.

That seems like sound logic--except there's no reason to
believe Obama thinks it's wise for the federal government to use policy tools
like global budgets or large-scale price bargaining with providers to lower the
cost of health care. One of his main health-policy advisers is David Cutler,
the former Clinton
administration economist who's among the most prominent center-left opponents
of aggressive cost control. Obama's plan includes some less ambitious
cost-control ideas (which Cutler describes here),
but nothing beyond that--quite possibly because he thinks, as Cutler
does, that medical innovation would suffer.

If Obama is resigned to a relatively expensive health-care
system, in which health expenditures account for an ever-larger share of the
federal budget, it would certainly make sense for him to believe (among other
things) that the rest of the government needs to tighten its belt and get its
fiscal house in order. In this context, surely it's reasonable to ask questions
about whether changes need to be made to a program that between 2017 and 2041
will spend around $5 trillion more than it will take in. One can ask whether it's
advisable from a political standpoint
for Obama to go down that road, but it seems strange for liberal pundits to insist
that every federal program be evaluated in a vacuum, irrespective of other
priorities. If it's out of bounds to suggest that reforming Social Security
might be part of a rational long-term response to ballooning health spending, then
presumably those speaking ill of Obama in this case will also refrain from
making the argument that defense expenditures should be reduced in order to
fund universal health care.

--Josh Patashnik

P.S. Last baseball-related blog point (I promise!). Citing Buster
Olney, Ross Douthat says
"there hasn't been a good World Series since the Tribe-Marlins tilt of
1997." This makes sense only if you slept through 2001 and (alas)
2002, particularly the former, which featured four one-run
games and no shortage of memorable moments.